The Vix, which measures volatility on the world’s leading index – the S&P 500, dipped to a close of 9.77 last Monday, nearing its lowest level since December 1993.
The figure is not even half the level of the index’s long-term average of 20.
Other asset classes shared in the stability, with bonds, commodities and currencies also reporting low levels of volatility.
Chris Ralph, CIO at St James’s Place (SJP), puts the trend down to a recognition that while the threats remain, they are known.
He said: “There are major political hurdles ahead but markets appear either to have taken the view that they have already weathered the biggest challenges, or that some of their former anxieties were overwrought. Fear, it seems, has been unwinding.”
Ralph pointed to Europe, where Emmanuel Macron’s victory in France drove stocks upwards to a 20-month high, soon followed by concerns over the challenges he has inherited, as demonstrated by the Eurofirst 300 ending last week up just 0.4%.
“Brussels warned that Paris needs to rein in spending as French state finances are in a worse state than previously thought.
“The European Commission’s latest forecast puts France’s budget deficit at 3% this year – the maximum allowed – and 3.2% next year.”
Further, the country’s national debt is set to be 97% of GDP, according to projections.
